Background Paper

No. 69

Underwriting in the Non-Group Health Insurance Market: The Fundamentals
June 4, 2009


Kathryn Linehan


Non-group health insurance is coverage that individuals purchase on their own rather than as part of a group. Most states currently permit non-group insurers to underwrite, a process whereby an insurer assesses the health and other characteristics of individuals to determine their likely utilization of health services or risk; insurers then use this assessment to determine whether they will offer coverage and the premium they will charge. Policymakers have identified underwriting and related practices in non-group markets as a target for reform to enable broader access for the currently uninsured. This publication reviews the characteristics of non-group markets and insurers' strategies for managing risk presented by people seeking non-group coverage. It also outlines relevant non-group market rules now in force in the states and considers how national rules might affect current markets.

Related Materials

See the Forum's "Glossary of Health Insurance Terms" (December 12, 2008) for a reference on fundamental insurance terms.

Also see the slides from the health reform series. The Forum sessions on December 3, 2008 and February 19, 2009 focused specifically on underwriting and rating in the non-group market.

In addition, see a 2005 Background Paper, "Fundamentals of Underwriting in the Nongroup Health Insurance Market: Access to Coverage and Options for Reform."

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